Yellen and Directive 10-289

Editors Note (6/11/2021): This is one of the topics at the 2021 G7 summit, this week. This blog was originally published 4/19/2021. Its presentation at the G7 summit grants warrant to its relisting.

Thou Shalt Not Leave, Nor Thy Money

We are living in an extraordinary era. From time-to-time, as the OBriceklainiden hydra issues official and unofficial missives, one catches statements and action variously reminiscent of Ayn Rand’s Atlas Shrugged, George Orwell’s 1984, and Boris Pasternak’s Dr. Zhivago come to life. Janet Yellen’s statement that the OBriceklainiden hydra is working to introduce a global minimum tax rate is one of those moments (Mimi Nguyen Ly, “Biden Admin Wants Global Minimum Tax Rate on Companies: Treasury Secretary Yellen,” Epoch Times, Apr 5, 2021, https://www.theepochtimes.com/biden-admin-wants-global-minimum-tax-rate-on-companies-treasury-secretary-yellen_3763417.html).

If you are not familiar with Ayn Rand’s Atlas Shrugged, or have forgotten some of the details, the novel’s governmental-industrial oligarchs instituted a 7-point “Directive 10-289.” In it were prohibitions against wage and price increases, new product innovation and introduction, hiring and firing of employees, and quitting one’s job, among other things. Perhaps most appropriate to Yellen’s recent announcement, was Directive 10-289’s prohibition against any business moving its business location under penalty of nationalization. Directive 10-289 forbade any business from moving away from the business address it occupied on the effective date of the directive. The oligarchs’ reasoning was that movement from one region to another financially disadvantages the abandoned locale by removing taxes and wages derived from the business’ presence.

Yellen’s “Global Minimum Tax Rate” eerily parallels the intent of Directive 10-289. As the OBriceklainiden hydra contemplates corporate tax increases, it seems to worry about businesses moving their corporate offices (and the taxes they pay) out of the U. S. to less taxing areas. In order to make that less attractive, Yellen’s proposal would encourage all nations to levy a globally-agreed minimum corporate tax, effectively removing any tax incentive for businesses to migrate from one country to another. Or, more pointedly, to disincentivize businesses from removing their taxable income from the United States.